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Published: 17:09, October 25, 2021 | Updated: 18:12, October 25, 2021
HK to create job opportunities, boost large-scale land supply
By Oswald Chan
Published:17:09, October 25, 2021 Updated:18:12, October 25, 2021 By Oswald Chan

A general view shows residential and commercial buildings including the "M+" (center left), a museum of visual culture, next to the International Commerce Centre and the Star Ferry piers (right), next to Victoria Harbour, as seen from Hong Kong Island on May 11, 2021. (ANTHONY WALLACE / AFP)

HONG KONG – Financial Secretary Paul Chan Mo-po said the Hong Kong Special Administrative Region’s government is striving to foster the diversified development of industries and enhance large-scale supply of land and housing, so that the majority of the population can share the fruits of economic development.

According to the finance chief’s blog entry on Sunday, Hong Kong has maintained an unequal economic structure for the past two decades with a huge income and wealth distribution gap among different social strata despite years of opulent economic growth.

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In the past 20 years, the gross domestic product of the financial services industry in Hong Kong rose from 12.8 percent to over 21 percent. The sector employs 270,000 people. The trade and logistics sector accounts for less than 20 percent of the city’s GDP but still employs over 670,000 people. The inbound tourism sector, which accounted for 4.5 percent of the city’s GDP before the COVID-19 pandemic, employs about 260,000 people. These figures reveal that Hong Kong residents in different economic sectors still have unequal access to the fruits of economic growth, Chan said.

The economic structure in Hong Kong leads to (a) significant gap in income and wealth distribution, and there is also a rising gap between the increase in (the) cost of living and the growth of labor income.

Paul Chan Mo-po, Financial Secretary 

At the other side of the spectrum, ample market liquidity due to massive quantitative monetary easing by the United States and European countries led to a massive surge in global asset prices. Coupled with tight land supply, this makes Hong Kong’s home prices significantly unaffordable to most residents. As the cost of living climbs, this seriously crimps the real purchasing power of workers' wages.

“The economic structure in Hong Kong leads to (a) significant gap in income and wealth distribution, and there is also a rising gap between the increase in (the) cost of living and the growth of labor income. This becomes the major dilemma in Hong Kong’s development that greatly diminishes the sense of gain and happiness of Hong Kong people, and this even affects the sense of belonging,” Chan said in his Sunday blog.

The finance chief pledged that Hong Kong will continue developing traditional industry pillars such as financial services, while also promoting the technology and innovation industry.

“The technology and innovation industry can be rapidly nurtured once it connects with the (Chinese) mainland’s factor of production and market demand. Leveraging on the mainland market and government promotion, the city’s professional services, property sector, catering, retail, arts and culture, as well as performance industry can have further development,” Chan said.

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The SAR government will strive to create an environment that is conducive to economic growth and foster diversified development of industries that can create quality job opportunities and increase income, Chan said. The administration will also bolster large-scale land and housing supply, targeted at increasing homeownership to slash the cost of living for most residents.

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